Ironing out the kinks in the crowdfunding process using scalable technology
7 min read
14 April 2016
As a fast-growing crowdfunding platform, Crowdcube co-founder Luke Lang explains why implementing a CRM system was key to providing a platform suitable for scaling up and cultivating relationships with entrepreneurs on the hunt for funding.
Exeter-based Crowdcube is now six years old and one of the foremost players in the equity crowdfunding space, offering a platform that links businesses looking for finance with investors interested in backing young and exciting enterprises.
It was set up by Luke Lang and Darren Westlake, who have since grown the team to around 80 and helped companies close fundraising rounds worth over £150m in total. It’s a Financial Conduct Authority (FCA)-regulated entity and gathers a large amount of data over the course of first making contact with a business looking to raise money to then banking the capital itself.
Lang revealed that a customer relationship management (CRM) system has been crucial to building out its offering on the entrepreneur side of the business. “It quickly became apparent that if you want to scale, you have to bring technology to bare,” he added. “We have got some pretty smart software engineers in the business, but we wanted them focusing on creating a world-leading crowdfunding platform – and not on technology for customer relationships.”
With multiple stakeholders both within Crowdcube and a fundraising business, Lang and his team were in need of a technology which could string it all together. A seamless process for entrepreneurs was crucial to making fundraising on the platform as attractive as possible.
“Our business development people use it to catalogue enquires, and the CRM system then goes on to be leveraged by our investment analysts and financial analysts,” he said.
“Being an FCA-regulated firm, we need to make sure we have the best possible processes and solutions in place. Having put the CRM in place, it’s had a dramatic impact – the time to get live on the site has dropped by 20 per cent meaning instantly greater efficiency gains.”
For Crowdcube and Lang, this means not losing leads and accurately capturing information – providing the best possible service for customers.
Having worked for both large and small companies before starting up Crowdcube with co-founder Westlake, Lang knew from very early on that a CRM system would be required. Even in the formative days when it was only the duo managing the small number of businesses raising money on the platform, doing so was “awkward and difficult”.
“You know that when you go from two people ten ten people, and from ten to 20, you need to introduce more rigorous processes so you aren’t making mistakes and are providing good customer service,” he commented.
“I’ve worked in big and small companies, using CRM systems, and know the power technology can have. But we didn’t use want a solution that worked for our needs in 2014, it needed to be able to grow as we did.”
To help Crowdcube make the most of its CRM system, the business has a full-time engineer who specialises in the technology. Being aware that as the business grew the system would have to evolve and adapt, in-house resources are key to making this happen, he stated.
By providing staff with a single view of the customer journey, Crowdcube has increased efficiency and bettered relationships with entrepreneurs.
Lang has also found that new staff are increasingly likely to be comfortable with technology such as a CRM system. Having people coming on board who have used it in some detail often means that they can become a “real asset” by unlocking a new part of the system Crowdcube wasn’t using to its full capability before.
Peace of mind
Knowing when and how to make major investments in technology comes down to being very clear about what is required from a software service, Lang emphasised. “You need to make sure all the stakeholders in the business are involved with the requirements document, which allows you to then source the service that is most appropriate.
“Then it’s about evaluating differing services against each other, working out what are the must haves and what are the nice to haves. Quite often you can end up being sold something that you didn’t need but was quite cool.”
After that it’s imperative, he said, to make sure the new service is well supported – often something that is underestimated in the integration and then utilisation phases. A new technology should be able to talk and communicate with other off the shelf services, Lang commented. “You don’t want one that puts you in a straightjacket from day one,” he urged.
“It’s about future-proofing your decision, and making sure you made the right call. Getting this wrong can be costly and painful when it comes to unwinding once you’ve committed to integration.”
Businesses and entrepreneurs these days, we learnt from Lang, are waking up to the power of data and the so-called “information age”. Sitting on great volumes of information and data, companies are able to ascertain great understandings of customers – how they interact with things like emails and websites. Smaller businesses, which are aware of this early enough, can then benefit greatly by having simpler implementation phases. “I’ve worked at some very large companies which don’t have effective CRM solutions, and it comes to to integration being too difficult.”
Thanks to making the decision early and operating it to its full capacities, Lang and Crowdcube have a much better understanding of company performance. Greater collaboration across departments has been fostered, taking a warm lead and converting it into business which then can often mean the successful closing of a multi-million pound fundraising deal.